At what point do your adult kids file their own taxes?

[DeniseNJ]

Obviously when they work and move out of your house. But what about kids in college even part time who don't work but live with you? They aren't a tax benefit as deductions since they are over 17 (18 and 21), and we are relatively high income, and neither has EVER worked a day in their lives--yes, I know.

Is it better for them to file on their own and get whatever low income tax benefit their is, like covid cash? Or do you need a separate address for that? I know that tax software always asks if you can be claimed on somebody else's taxes, but what about adults who live with other people? Does it matter if they are related or parent child? Like if generations live together I assume their file their own taxes or does it matter if one of them isn't working. Like if my kid was 25 and not working (a real possibility, I'm afraid) does he file his own taxes or do I just keep claiming a grown ass adult, or two, on my taxes for no reason?

[NotJen]

When I had my own income, I filed my own taxes - so I started filing my own tax return my freshman year of college.

My parents claimed me as a dependent through college.

Here's what the IRS says on who has to or should file a federal return: https://www.irs.gov/help/ita/do-i-need-to-file-a-tax-return

You'll have to check the rules for your specific state, also.

[DeniseNJ]

most stuff refers to if you CAN be claimed on someone's taxes, not if you ARE claimed on someone's taxes. So maybe I don't have to claim him and can let him file on his own, even though I pay more than half his living expenses?  I answer all the questions honestly but some aren't clear to me. Like some things ask if he's a student, others if he attends school at least part time, and others if he is a full time student. Well he takes 9 or 10 credits, 3 classes, and I guess full time is 12 credits or 4 classes, I assume.

He lives at home and I do support him, so I should just keep him on my taxes, but his being 21 means I don't get any tax credit for him, and he only goes to school part time, really.  I guess I shouldn't be trying to pawn off the results of my poor parenting onto the rest of the tax paying population just to reduce my tax bill. The ethics are clear, but wondering what's best financially.

[Metalcat]

I'm not American, but are you saying that your adult child doesn't need to file their own taxes because you are claiming them on yours somehow??

I started filing my own taxes at 16, I don't think I had an option not to.

[merula]

If you provide more than half of your children's support, they qualify as your dependents, and therefore you CAN claim them as such. It probably doesn't change your taxes one bit either way, since the change to a $0 personal exemption means that there's not a lot of benefit in dependents over 17 anymore (unless you're going for Head Of Household status, but since you said "we are relatively high income, I'm assuming MFJ).

Your children almost certainly are disqualified from any possible tax benefits because they CAN be claimed as your dependents. Whether or not you do is immaterial. They also don't have to file because they're not earning income.

If you're paying educational expenses and are not above the income thresholds for the educational tax credits, those might be a factor. (IIRC it's like $160,000 MAGI for MFJ.)

As to when your children should do their own taxes, it depends. I started working at 15 and my parents sent my income info to their tax preparer along with theirs for as long as I was a dependent, because it can be really tricky to do a dependent's return stand-alone, but much easier to do as a household. (I can confirm this as a volunteer tax preparer.) I did my own taxes starting the year I graduated college.

[seattlecyclone]

If you have your own income you should file your own taxes. Whether you're someone else's dependent or not is a separate question.

[DeniseNJ]

I'm not American, but are you saying that your adult child doesn't need to file their own taxes because you are claiming them on yours somehow??

I started filing my own taxes at 16, I don't think I had an option not to.

That's correct. DH and I file out taxes and list the two "kids" since they both still live with us, and we still support them. If they worked we would just list their income on our tax forms but under their names. We can definitely still do this but if we don't have to, there may be a benefit for them to file their own taxes if they weren't in school full time. Since ds only attends part time, I thought maybe he could file on his own, with his lack of income and maybe get some tax credit back.


No we don't have any tuition benefit. Yes we have high income so I should stop trying to scam the system. It's just that as wage earners living in NJ, we bring home only half our pay. The NJ tax has so few deductions. They tax TSP (even though they don't tax 401k!), 403b, health care premiums, 529 contributions, HSA contributions, everything. Yes, I'm moving out of NJ asap, but kids go a state school and don't handle change well. Just checking on any legal loopholes.

[DeniseNJ]

If you have your own income you should file your own taxes. Whether you're someone else's dependent or not is a separate question.

Actually, it's not a separate question at all. Who you live with, who pays for more than half your living expenses, and how much you earn are the actual questions to consider when deciding whether to file on your own or not. Whether you can be claimed on someone else's taxes has lots of tax implications.

[NotJen]

I'm not American, but are you saying that your adult child doesn't need to file their own taxes because you are claiming them on yours somehow??

I started filing my own taxes at 16, I don't think I had an option not to.

That's correct. DH and I file out taxes and list the two "kids" since they both still live with us, and we still support them. If they worked we would just list their income on our tax forms but under their names. We can definitely still do this but if we don't have to, there may be a benefit for them to file their own taxes if they weren't in school full time. Since ds only attends part time, I thought maybe he could file on his own, with his lack of income and maybe get some tax credit back.


No we don't have any tuition benefit. Yes we have high income so I should stop trying to scam the system. It's just that as wage earners living in NJ, we bring home only half our pay. The NJ tax has so few deductions. They tax TSP (even though they don't tax 401k!), 403b, health care premiums, 529 contributions, HSA contributions, everything. Yes, I'm moving out of NJ asap, but kids go a state school and don't handle change well. Just checking on any legal loopholes.

If they work, they should probably file a tax return, because they may be owed a refund, EVEN IF you still claim them as dependents.  I got small tax refunds while working in college and was still claimed as a dependent on my parent's taxes.

If you have your own income you should file your own taxes. Whether you're someone else's dependent or not is a separate question.

Actually, it's not a separate question at all. Who you live with, who pays for more than half your living expenses, and how much you earn are the actual questions to consider when deciding whether to file on your own or not. Whether you can be claimed on someone else's taxes has lots of tax implications.

Actually, it is a separate question.  And who you live with does not matter, who pays for your living expenses does matter - but only for the dependent question.  You can file your own return AND STILL be claimed as someone's dependent.  You need to work out what's best/correct for your family.

If I answer all the questions in the link I gave you as if I were a dependent college student with a job, it tells me:
   You are not required to file a tax return for 2020
   You should file a tax return for 2020
   The return may generate a refund.

[seattlecyclone]

If you have your own income you should file your own taxes. Whether you're someone else's dependent or not is a separate question.

Actually, it's not a separate question at all. Who you live with, who pays for more than half your living expenses, and how much you earn are the actual questions to consider when deciding whether to file on your own or not. Whether you can be claimed on someone else's taxes has lots of tax implications.

Actually, it is a separate question.  And who you live with does not matter, who pays for your living expenses does matter - but only for the dependent question.  You can file your own return AND STILL be claimed as someone's dependent.  You need to work out what's best/correct for your family.

If I answer all the questions in the link I gave you as if I were a dependent college student with a job, it tells me:
   You are not required to file a tax return for 2020
   You should file a tax return for 2020
   The return may generate a refund.

Exactly. A kid filing a tax return is not mutually exclusive with their parent claiming them as a dependent. There are various situations where a dependent must file a tax return, and other situations (such as having a part-time job with some tax withholding) where maybe they don't exceed the threshold where it's required to file a return but the only way to get a refund is to file one.

[teen persuasion]

My kids filed their first tax returns when they had income to claim, so that they could get a refund of the taxes withheld.  DS2 was only 15, turning 16.  He was definitely still my dependent, and I claimed him as such on our MFJ return.

I'm currently having issues with our state tax board - they've decided to disallow a college tuition credit from past years returns.  To clarify the matter, I've had to show them DS4's tax returns, because he claimed some of his scholarships as taxable income, so that we (parents) can claim to have paid tuition to be eligible for the credit.  The taxable scholarship income doesn't appear on our returns, and the credit doesn't appear on his returns (because he's not eligible as a dependent), so the whole picture is only clear when you view BOTH returns together.